Paramount Global Stock Downgraded as Asset Sales Delayed

BofA Securities analyst, Jessica Reif Ehrlich, has downgraded shares of Paramount (ticker: PARA) from Buy to Underperform and drastically reduced the price target from $32 to $9. This downgrade comes as a result of the entertainment company's lack of preparation to sell some of its assets.

Previously, Reif Ehrlich had a positive outlook on the stock, assuming that Paramount would proceed with asset sales. However, despite receiving bids for assets such as Showtime and BET Media Group, it appears that these sales will not be happening anytime soon.

The analyst expressed concern that the longer it takes for potential asset sales to be executed, the less value they could ultimately generate. In addition to this, the challenging macro backdrop further contributes to an unfavorable medium-term outlook for the stock.

In February, The Wall Street Journal reported that Paramount declined a $3 billion offer for Showtime. Similarly, in August, the company rejected the opportunity to sell BET Media Group, according to the Associated Press.

Paramount has not yet responded to a request for comment on the matter. However, Chief Executive Robert Bakish mentioned during the company's third-quarter earnings call last week that they remain open-minded when it comes to mergers and acquisitions, with a focus on maximizing shareholder value.

So far this year, Paramount stock has fallen by 21%.